We've all seen this before. The government and contractor sign a contract with a base period and several 1-year options. Sometimes, the 1-year option periods even mirror the government's fiscal year. A nice little puppy. Then, the harsh realities of government take over and our little puppy grows into an unwieldy mongrel. Such is life in federal contracting and here is a story about one such dog.
On February 27, 2009, the Army National Guard and Glasgow Investigative Solutions, Inc. (GIS) signed a contract for armed security guard services at the National Guard Armory, Washington, DC. The contract included a 3-month base period from March 1, 2009 to May 31, 2009 (CLIN 0001) and 4 option years (CLINs 2 through 5) beginning October 1, and ending September 30 of 2010, 2011, 2012, and 2013. There is another option to extend the base period for 4 months from June 1, 2009 to September 30, 2009 (CLIN 0006). Of course, the contract included the clause at FAR 52.232-18, Availability of Funds (Apr 1984).
Mod 1, a bilateral agreement, exercised the option in CLIN 0006 for the 4 months to the base period from June 1, 2009 to September 30, 2009 and added the clauses in FAR 52.217-6 Option for Increased Quantity and 52.217-8 Option to Extend Services.
Mod 2, a bilateral agreement, fully funded the contract through September 30, 2009.
Mod 3, a bilateral agreement, modified the contract by extending CLIN 0006 from October 1, 2009 through January 31, 2010 and fully funded this 4-month extension. The 4, 1-year option periods in CLINs 0002, 0003, 0004, and 0005 were reset to begin February 1 and end January 31 of the following years.
Mod 4, a bilateral agreement, exercised the first 1-year option period in CLIN 0002 from February 1, 2010 through January 31, 2011.
Mod 7, a bilateral agreement, extended the first option period in CLIN 0002 for 2 months, from February 1, 2011 through March 31, 2011.
Mod 8, a unilateral agreement, and Mods 9 and 10, bilateral agreements, extended the first option period in CLIN 0002 from April 1, 2011 through June 30, 2011.
By now, the contractor was irritated with the extensions to the first option period. After all, the parties signed an original contract that contained 1-year options--not 1- or 2-month extensions to the first option period. The contractor notified the contracting officer about its concerns. On June 28, 2011, the contracting officer noted the contractor's concerns but explained that "due to limited funding, the government is unable to exercise a one (1) year option to the contract at this time." Instead, the contracting officer said she was prepared to extend the contract for an additional 30 days through July 31, 2011. The contractor agreed to the 30-day extension but maintained its position that the modification is contrary to the original contract.
On November, 17, 2011, the contractor filed a claim due to fundamental changes in the original option periods. The contractor had signed up for 1-year options not 1- or 2-month extensions. The contractor filed a notice of appeal to the Armed Services Board of Contract Appeals on April 27, 2012 and about 1 year later the Board rendered its decision.
So what did the Board say? Find out on the bottom of page nine at Glasgow Investigative Solutions, Inc.